Monday, March 17, 2014

The $1 Billion Marketing Gamble of Quicken Loans

How would you like to combine to of your favorite pursuits into one activity? If you like NCAA basketball March Madness and you like money, Quicken Loans has an opportunity too good to refuse. Quicken's Billion Dollar Bracket Challenge could be a life changer- correctly guess the winner of every NCAA tournament game beginning with Thursday's contests and you win $1 billion- it's just that easy. Of course, it is not just that easy; odds of someone having a 63-0 bracket have been estimated to be 1:9,223,372,036,854,775,808. That is 1 in 9.2 quintillion, or in other words your odds are not very good at all. Before throwing in the towel and passing on Quicken's contest, it is worth noting that 20 prizes of $100,000 each will be awarded to the best "imperfect" brackets.

What is Going On?

Has the marketing team at Quicken Loans lost their collective minds? Why risk being saddled with a $1 billion obligation if someone does beat the odds and win the contest? At the very least, Quicken is on the hook for $2 million in prizes for the imperfect brackets plus marketing costs for the promotion. On the contrary, Quicken is poised to get a high return for its lucrative investment. Here are three reasons why:

Exposure from publicity - Quicken is partnering with Berkshire Hathaway, Warren Buffet's firm, on this promotion. Quicken Loans is getting extensive publicity in traditional media channels as well as via sharing on social media.In a highly competitive environment to gain basketball fans' attention, Quicken Loans may have succeeded in rising to top-of-mind when it comes to companies marketing around March Madness.

Build customer relationships - Cynics wonder if Quicken will look to profit from data collection that occurs through the promotion, selling consumer data to other companies. Quicken insists its interest is in identifying prospective customers with whom engagement efforts can be focused. Who knows what percentage of entrants into the Billion Dollar Bracket Challenge will be high quality leads for Quicken Loans, but at least it will have captured information about a sizable batch of people that may have an interest in Quicken's offerings.

Be Creative but be Strategic

Promotions like the Quicken Loans Billion Dollar Bracket Challenge are potentially effective for their novelty and PR value alone. However, a great marketing campaign ultimately connects tactics with marketing strategy. In this case, Quicken may have an ultimate goal of increasing the number of mortgage customers or revenues. Additionally, relationship goals such as number of subscribers to an email newsletter or size of community on social networking sites could be objectives that are intermediate accomplishments on the road to securing a paying customer. Promotions are the fuel that power the marketing engine, helping an organization advance toward its goals.

If you are one of the millions filling out brackets this week, good luck!